In the last month or so, I came across an article that looked at SME survey results that revealed a deep concern for small businesses owners on this year’s most contested national elections. This column has also prompted some conversations among us, small business owners/freelancers to ask some questions about what our future may entail.
Let me start by pointing out some of the results from the survey which highlighted the following:
- “The SME Confidence Index, conducted by specialist SME financier, Business Partners Limited, posed a new question to its constituent of respondents, which is made up of local small business owners. Respondents were asked whether they were concerned that the imminent risk of economic turbulence and protest action during the election season, would impact their operations. Almost half of SME owners (49%) answered yes. About 33% of the respondents were of the view that the elections will bring about much-needed change.”
- “Also, when it comes to SMEs’ confidence that their businesses would grow in the next 12 months saw a 14-percentage point increase year-on-year and only a 0,7-percentage point increase quarter-on-quarter. Likewise, an increase of 4 percentage points was seen in SMEs’ confidence that the economy will be conducive to business growth in the next 12 months, when compared to 2022 with a 5 percentage points increase quarter-on-quarter. It’s therefore fair to say that the general sentiment among small businesses has been tentatively optimistic in the face of many challenges in the economic landscape. However, when the election day was fast approaching, this optimism was becoming subdued.”
When I was having a conversation with my business peers about the possible changes in the political sphere – we had a few concerns about what would happen to laws around broad-based Black Economic Empowerment (B-BBEE), Affirmative Action (AA), the land issue, labour laws, National Student Financial Aid Scheme (NSFAS) during the negotiations in the new government of national unity (GNU) negotiations. As small businesses, we were looking at very specific, key pillars of B-BBEE that include Ownership and Management Control (Indirect Empowerment), Preferential Procurement as well as Enterprise Development. This is because these have direct consequences on black owned businesses – most importantly, Preferential Procurement and Enterprise Development.
A lot of small businesses are surviving right now because of the support that we get from big businesses. These laws have, in the last few years ensured that we benefit through preferential procurement and enterprise development; thereby ensuring that they help develop and grow our small businesses. Any changes to these laws coupled by the ailing economy, would have an adverse effect on our businesses. The country’s struggling economy has seen a number of local and international businesses closing down. This does not only have an impact on loss of jobs for that company’s employees, it also has an impact on SMMEs that were getting opportunities from those businesses.
The uncertainty in the political sphere has created some anxiety and concern for some of us small businesses. The decisions made by politicians in the new GNU will either have a positive or negative impact on the future of small businesses. We are waiting with baited breath to see what will happen next in the political environment and how this will affect us as SMME owners. However, we are still optimistic that we could still see positive change in the support given to local small businesses.
